tv Bulls and Bears FOX News February 23, 2013 7:00am-7:30am PST
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and the fear mounting. >> a tremor will hit the american academy. >> for thousands of parents who have to scramble to find child care for their kids. >> sequestration would be destructive to our nation's security. >> and says air traffic contollers. >> and cost us 750,000 jobs. >> educators laid off. >> houses burning, seniors starving, criminals fleeing and don't any about eating. what? 85 billion dollars is a drop in the massive budget bucket and chump change compared to our 16 1/2 trillion dollar debt. so, if washington can't cut that measley amount, is the real scare not cutting at all? hi, everyone, i'm brenda buttner, this is bulls and bears, let's get right to it. the bulls and bears this week, gary b smith, tobin smith.
jonas max ferris along with john and jehmu green. john, lawmakers using scare tactics for 85 billion in cuts, but you say the real scare is not cutting at all? >> yeah, you better believe it. look, when you have no facts and you use emotions and fear. oh, my god, children are going to starve to death in our streets and air traffic shut down. that's when you don't have facts. and both sides are doing this, both sides refusing to cut. look, according to president obama's own budget, we're going to run trillion dollar deficits ten years from now. and ten years and about 48 trillion dollars over the next ten years, we're trying to cut 1 trillion. instead of 40 cents of every dollar we're asking our government to borrow 38 cents a dollar. if a company can't cut 2%, not much less the entire 40% that we're borrowing, something's
wrong. this is fear mongering at its worst. >> well, jehmu, do we have reason to be afraid? are you scared? >> yes. and we absolutely have reason to be afraid, brenda. how do you spell bad news for the company? s-e- s-e-q-u-... you get the point, sequester. and at the new year when we were looking at the fiscal cliff, but is there really a difference between the exorcist and the shining? the fear is there. of course we need cuts, you need it in stages. you don't do it when the economy is fragile. you do it when the recovery is stronger. and these across the board cuts, bad news. >> and tobin, i wouldn't call them cuts, they're trims, and to hear the white house, i'm afraid to go out of the house, should we be scared of this?
>> obviously, the economy is scared of something else and scared of it turning to 26 trillion dollars in a 15 trillion dollars economy, in other words, we would in fact be great. the 85 billion, of course, doesn't account for the 50 or 60 billion, and if you add that back in. this is literally what the government spends, remember, the government spends 4 billion a day and this is actually, to carry this, this is about, you know, maybe ten days of total spending all in. no, it's not a big deal, it's total semantics. >> we've got selling on this show, gary b. shouldn't we be hitting the panic button? >> absolutely not. we should be hitting the panic button if we d because there's a few head scratchers here, i know that jehmu is worried about this. look around. is there any agency out there in the government that can't say, you know what? we're working to the bone, we're working, 100%, no one has any free time. no one takes a walk out to have a cigarette. they're never on the internet for anything else.
my gosh, 2%, waste, fraud. my gosh, probably ten times out in every agency from the f.d.a. to the department of congress to some useless agencies like the department of education. and the other thing we saw in the clip that president obama had the first responders, the firefighters and oh, my gosh, they're all going to vanish. well, i have a question, why is firefighters, why is that a federal function? we're paying for firefighters for our tax money in arizona and pennsylvania. that's all local unless you think that's small dollars. that's 310 million dollars we file to the government to spend on localities. >> jonas, i'm going to get to you in just a minute, but i want to let jehmu respond. go ahead. >> well, the facts are, with the sequester, the gdp goes down, and if unemployment goes up. that's not good for anyone. 10,000 teachers are going to be at risk of losing their jobs, what about the 400,000
people-- >> and lose the health services. >> jehmu, we have the-- >> it's a responsibility, not a-- >> and education will be a factor. 1.5 million children, their education will be affected with the sequester, i'm concerned about the 400,000 people that are going to lose mental health services and air traffic control e, are you getting on a plane after the sequester. >> and 400,000 is amazingly wrong number. >> brenda: i want to let jonas weigh in here. >> look, there's two problems here, first of all, i don't see what the urgency is to pay off the debt for the next couple of years while the economy is slow, right now the government borrows at a negative interest rates and gets cheaper to pay off because of inflation, that won't be forever, but that's the case. and a longer spending problem that needs to be addressed and by doing the sequester, we think we've solved the spending problem which we're not in the ballpark solving
and major ones they're going to kick in the next 20 years to really balance the budget with the retirees and that's the big problem we're not going to address. >> we might be bet her off, but i want to get to john lay field. we might be better off. look it, washington could do this in an easier way, in a more professional way, but we're not likely to see that. so, maybe the sequester is the only way we're getting any cuts. >> we're fot going not going to nobody's going to cut. nobody. according to his budget we're running a trillion dollar deficit ten years from now. the cbo backs that up. what toby talked about, if interest rates spike we're not going to have money to pay anything, jehmu, it's not a matter of we're cutting teachers out of 8 million. it's a matter we have to do something, we're doing absolutely nothing. if you can't cut 2%, something's wrong. >> go ahead, gary b. john brings up a good point, and the cuts the 10,000
teachers, this is an obama strawman, oh, my gosh, all of these teachers are going to vanish. as i get back to the point the teachers, the firefighters are all local and state responsibilities, and unless i'm wrong, there is no u.s. government high school out there, where teachers are employed. so, that's false. laying off those tsa workers, oh, my gosh, we're talking again, about 2%, we're not talking about dismantling the entire department of homeland security you've got to put this stuff in perspective. >> but they don't. you know, john makes the point. if any of the math, maybe gets boring, horrible for 5,000 teachers, but for the 8 million teachers we have to put it in context how long a 15 trillion dollar economy is. if you keep it in context, if you don't cut now, we don't cut ever, this is the best idea of a bad situation, let it happen. >> brenda: well, there's lots of things to cut though jonas, you don't have to cut the important people. >> it's a red herring, if the federal government cuts all of the employees we have and still sent out the social
security checks and medicare, we're still going to have a deficit problem in 25 years. and it's not cutting the problems that need to be addressed that we're going to take payments in 10, 20, 30 years. the next month, that's not the real problem. >> brenda: toby, last word. >> entitlement is a big issue and people doesn't have the guts to do it. 85 billion, great, that's a start. >> brenda: thanks, guys. from scare tactics to a real scare, find out what seven in ten consumers are doing right now that's causing a growing list of companies to sound the alarm. is our economy in trouble and are tax hikes to blame? . [ truck beeping ]
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south central washington state. that hold a brew of radioactive and toxic waste are leaking at the hand for nuclear reservation. and there's no health risk to the public or environment, but keep a close eye on it and lawmakers are calling for an investigation into the the site's monitoring program. we'll keep you posted and also in the northeast, another major snowstorm coming just two weeks after a record breaking blizzard that buried much of the region. the winter storm blamed for four deaths in the midwest. treacherous road conditions leaving drivers stranded and 18 inches of snow in some areas, i'm jamie colby, i'm going to send you back right now to bulls and bears. there you go. keep it on fox. >> well, this didn't take long, that payroll tax hike kicking in last month, kicking consumers where it hurts. just ask the owner of olive garden, it's the latest
company to warn the hikes are taking a deep toll, as nearly three quarters of americans say they're cutting back to make ends meet. is the economy in danger or is this just a temporary blip? gary b, what do you say? >> well, you know, i think that everyone watching out there is concerned unless their last name is it maybe buffet or gates. this is not a temporary blip. we just saw the warning from wal-mart. we've seen concerns from burger king, from kraft. everyone's trying to adjust to this smaller consumer spending. why? because the consumer's worried about three things that have not changed one iota under this current administration, and do they have money in their pocket, do they have a job and is the value of of their house going up or down. money in their pocket. disposable income has flat lined since 2008. unemployment, when you talk about the u-6 number, the number that includes people that have given up has doubled since 2008 and the value of their home hasn't budged one iota since the year 2000.
so, there's a lot of people underwater that bought at the height of that market. it's not good out there. i think it's getting worse. >> well, toby, actually, they might be feeling richer because wall street has certainly been on a tear and housing is starting to lay had a foundation, isn't it? >> a pertinent pun. yes, we're up 12% year over year and i believe that gary was playing tennis when that came out. the other issue, there is no question that this cash out of the system, it's got out of the system and so, by the systems work, we have a little reaction what we've had and then we will figure stuff out. consumers are a lot smarter than i think people give credit for and yes, there may be 2% less there, but there's other pieces of that economics puzzle they'll solve. and remember, the economy didn't die because we didn't have the 2% and you know, didn't go into a boom because we've got the 2% and the temporary withholding, so therefore, you know, we're going to find a marginal
place. >> okay, wal-mart is the biggest private employer in the united states, john lay field, and it says it's really hurting. sales of hurting because of this. >> yeah, people are scared to buy. we have the lowest participation rate over three decades ago and we have the most dysfunctional congress, d.c. administration in the history of this country, probably the history of the empires and america sees that and you've raise the taxes on the rich and the only other place-- >> and i've been to greece. the only place that raise taxes further because everybody says we need more revenue, is going be to be the middle and lower class and that's what americans are scared of. afraid of spending because anything coming out of d.c. is going to be bad. >> brenda: jehmu, what do you think of the economy. is this really going to keep hurting? >> well, the payroll tax holiday was a holiday. it was never going to be permanent. i'm sure there are many
children out there who want santa claus to come year round, but that doesn't happen. so these companies, they should be grateful that the federal government gave them this student for the last two years, but look, they haven't fallen off a cliff and haven't dried up. look back to where we were in december where they said they're going to spend and we're at 4% higher than the year before. and if you look at the bloomberg consumer comfort index, half the of americans are saying their personal finance they're looking at it highly positive which is a year high. and this is not something to be freaking out about right now. >> and from china, he loans us 40 cents on every single dollar largest stimulus in history. santa claus is real apparently. >> if you're concerned about it, can you imagine when the sequester hits? that's, that's the tragedy. >> oh, give me a break. >> that's fear mongering, that's nothing else, please. >> and to jehmu's point
further. >> brenda: go ahead. >> we should be grateful we're not raising the payroll tax to make up for the lost tens of billions to the treasuries fund and going back to the level it was a few years ago, we're lucky in that sense, that system is the big e-hole they've got and had enough. look, it helped retailers the lowest a lot and hurt them this year. this is not in a recession, we've lived through this payroll tax clip and for cycles going back for many, many years, to think that we need it lower or we're going into depression is absurd. we're not there now. and we can handle paying off our debt. >> gary b. we may not be in recession officially right now, but we need one more quarter of negative, of contraction of gdp and we will be. >> john sums it up. we're the worst of all empires, worse than the aztecs, worse than the mayans, for crying out loud. i tell you what now. the most important point we
both did, it's that unemployment number. we're not going anywhere unless that labor participation rate ramps up and it's terrible right now. >> brenda: okay. we're an empire, you guys are gladiators. all right, thanks, guys. what's got the hulk sulking? harry potter wishing and spider-man spinning? a universal problem with the health care law. neil's gang is all over the super fallout. that's at the bottom of the hour, but up here next, teacher unions protesting, the very test by which they're judged. they want them thrown out of the classroom and get this, they're blaming corporate america. someone here says, that's a big pile of number two. pencil. aw this is tragic man, investors just like you
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>> this is my school and i'm throwing out the test. >> yea! >> that's what teachers unions nationwide are pushing to do. they're saying standardized testing is pushing a corporate agenda in the classroom and they don't want to be judged by test scores. is that exactly what our failing schools need more of? >> it is, brenda. we have companies like microsoft, like ups, like amazon that are envy of the world and yet, our education system, despite the fact that we pour trillions into it in the last 40 or 50 years hasn't budged one iota. we need to start measuring the
teachers. in corporate america, jonas, i don't think they take out pencils and-- >> i don't know what-- i bet you can't find it in a google headquarters. >> we should have is more like carpet america, and they don't do standard advertisiized testi google or amazon either, a ridiculous way it promote somebody and they also don't have unions to the companies and upside we're going to heron from th-- learn from this. it's not done in corporate america, who's taken a test in a company. >> and okay. john, you don't think this is old-fashioned, do you, to take a test and judged by it? >> good lord, no. gary b is 100% right. what he talked about at the p and l, that is your test. a manager is measured on merit
and companies are becoming more proficient overseas and we have a shortfall of up to 50,000 tech engineers according to bill gates and our system is failing, because of the unions. >> brenda: okay. jehmu, does this make teachers teach to the test and is there something wrong it that? >> there is something wrong with that. standardized tests make teachers teach to the test and in the long run, it's bad for the economy. standardized tests do not find to be innovators, i can guarantee you that steve jobs doesn't do well on standardized tests and-- >> we know that because he went to a crummy college, that's how we know that. >> you cannot put students all in the same bag, it doesn't-- students have different ways of learning. >> the violin here going.
>> brenda: toby. >> the bigger issue, this is about tenure, teachers being scared, somehow if there's no way to measure them, then there's no way for them not to get tenure. if you look at the failed system and we know it's failed and we continue it as a failed system then we're the insane ones. >> thanks, guys, and thank you to jehmu for joining us, we appreciate it. >> well, danica, may be tomorrow's favorite on the track, but someone here is going to help you get in on the fast track to profits. od . yup, i've got... [ voice of dennis ] ...allstate. really? i was afraid you'd have some cut-rate policy. nope, i've got... [ voice of dennis ] the allstate value plan. it's their most affordable car insurance -- and you still get an allstate agent. i too have... [ voice of dennis ] allstate. [ normal voice ] same agent and everything. it's like we're connected. no we're not. yeah, we are. no, we're not. ♪ ask an allstate agent about the value plan.